Felix Onuah

ABUJA (Reuters), – Nigeria’s Finance Minister Zainab Ahmad said Wednesday that the country is looking into a subsidy to transport its most vulnerable families in order to offset the impact of a “eventual” withdrawal of a petrol subsidy.

Ahmed claimed Tuesday that Ahmed had announced on Tuesday that the government intended to end the subsidy for petrol and to replace it by a monthly payment of 5,000 Naira to the least fortunate families.

She said that she believed the next set questions were in the transport subsidy of 5,000 Nigerian naira. This subsidy is being worked out by the team to help with the eventual elimination of (petrol) subsidies.

After a Cabinet meeting in Abuja, she said that the transport intervention would be available for 20-40 million people for six- to twelve months.

According to the 2020 budget, petrol subsidies were supposed to be ended in June. Ahmed claimed that this subsidy had cost the government an average of 243 billion Naira each month at its last revenue count. However, it has been steadily increasing.

Nigeria will lose 3 trillion naira (or $7 billion annually) if it does not end its petrol subsidy, she stated, adding that the state-oil company, NNPC, will hardly pay any subsidy payments to the government.

Ahmed stated that they are still in negotiations because there is still money to be received from the Federation account.

Tuesday saw the World Bank urge Nigeria to eliminate its expensive petrol subsidy in three to six months. They also called for improved exchange rate management, and other reforms to increase growth.

According to the bank, Nigeria has fallen behind in the implementation of reforms that were initiated during the COVID-19 Pandemic.

The projections for Nigeria’s GDP growth were made after it grew by just over 4 percent in its third quarter. It is the fourth consecutive quarterly increase since the COVID-19-induced downturn in 2020.

According to the finance minister, the government wants to increase the economy’s growth to exceed that of population growth. The average annual economic growth for this year was 3.3%. This is slightly more than the 3.2% population growth.

($1 = 409.63 naira)